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By adding a crypto wallet and exchange capabilities, Apple could attract a huge customer base due to its up to standard security system.
Following Tesla Inc (NASDAQ: TSLA) quest into the crypto market through Bitcoin, RBC analysts speculate Apple Inc (NASDAQ: AAPL) could be the next unicorn to join the cryptocurrency industry. As a result, RBC analysts raised their Apple price target from $154 to $171, approximately 25% up from Friday’s close.
In a note to clients, RBC analyst Mitch Steves maintained an ‘Outperform’ rating on the Apple stocks. According to the firm, Apple is well-positioned to venture into the crypto market through its wallet app, which is pre-installed in its iPhone devices.
“If the firm decides to enter into the crypto exchange business, we think the firm could immediately gain market share and disrupt the industry,” RBC said. As a result, the company could significantly take the crypto industry, particularly in the United States to the next level in the next decade.
Apple Price Target Is Up
Apple stocks closed yesterday trading at $136.91, up 0.11%. Meanwhile, they had dropped approximately 0.31% during Tuesday’s premarket. Apple stocks enjoyed a profitable 2020 despite the market disruptions caused by the coronavirus outbreak. According to metrics provided by MarketWatch, Apple stocks surged over 71% last year, and have managed to add approximately 18%, and 6.30% in the past three months and one month respectively.
Having introduced several product updates at the tail end of last year including the iPhone 12 series, Apple pack, custom-made chips among others, its revenues remained steady.
Notably, despite the reduced global smartphone shipments caused by low market demand due to the pandemic, Apple’s 5G network-enabled iPhones are well poised to compete with other smartphone makers. Moreover, with a market valuation of approximately $2.3 trillion, Apple is capable of venturing into different emerging markets including the crypto industry to diversify its revenue collection.
According to RBC analysts, Apple could utilize its huge global smartphone market share spanning to over 1.5 billion active users to venture into the crypto industry. RBC analysts used the Square Cash app analogy with approximately 30 million monthly active users and managed to collect approximately $1.6 billion in crypto-related revenue.
To narrow down, RBC went further to assume only last year’s sale of around 200 million iPhones were to be used in the correlation. Reportedly, Apple could collect around sevenfold in revenue as much as the Square Cash app collects.
By adding a crypto wallet and exchange capabilities, Apple could attract a huge customer base due to its up to standard security system. According to RBC, Apple does not need to hold Bitcoin on its balance sheet, but it could be a plus. “To be clear, we do not believe Apple needs to hold Bitcoin as a balance sheet asset, although it would likely help.” RBC analysts noted.